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Sutter Health Antitrust Class Action Lawsuit Overview:
- Who: North California’s Sutter Health is being sued by patients who allege they were forced to overpay their health insurance premiums because of the health system.
- Why: The plaintiffs say Sutter Health abused its market power by discouraging patients from using lower-cost insurance and hospitals.
- Where: The trial is underway in California federal court.
A class action trial seeking $1.2 billion in damages from a major health system for allegedly “price-gouging” people on their medical insurance premiums has kicked off in California.
The class action complaint claims Sutter violated antitrust and unfair competition laws, causing certain people and employers in parts of Northern California to overpay health insurance premiums whether or not they used Sutter hospitals.
Plaintiffs in the trial, which kicked off Feb. 10, seek to represent more than 3 million employers and people who were affected by the alleged anticompetitive behavior.
According to the plaintiffs, Sutter used its market power in areas of rural Northern California, where it is in most cases the only hospital, to bind insurers in places where it does have competition.
That allowed the health system to overcharge for its own services, the lawsuit alleged, causing nearly $400 million in insurance premium overcharges to the class between 2011-2017.
The class includes anyone living or working in certain areas of Northern California who paid premiums for a fully insured health insurance policy from Blue Shield, Anthem Blue Cross, Aetna, Health Net or United Healthcare from Jan. 1, 2011, to now.
The law allows triple damages if the plaintiffs win against Sutter Health, meaning a potential award of $1.2 billion.
Sutter Denies Wrongdoing in Antitrust Class Action
Sutter denies that it has done anything wrong or that its conduct caused any increase in the price of premiums that individuals and employers paid for health insurance.
The system operates 24 hospitals with more than 12,000 doctors and 16,000 nurses.
It’s the second such lawsuit filed against Sutter Health. In 2021, Sutter Health agreed to a $575 million settlement resolving claims it violated competition law.
The United Food and Commercial Workers International Union and Employers Benefit Trust filed a class action lawsuit in 2014, alleging Sutter Health had “imposed price secrecy, all-or-nothing and anti-tiering provisions” in its health plan contracts and that the company’s restrictive conduct violated both the Cartwright Act and Unfair Competition Law.
The People of the State of California filed a second lawsuit in March 2018, and the court consolidated the cases in May 2018.
Did you pay Sutter Health for health services or products? Let us know what you think of the settlement in the comment section below.
The plaintiffs are represented by David Brownstein and David Goldstein of Farmer Brownstein Jaeger Goldstein Klein & Siegel LLP; Matthew L. Cantor and Jean Kim of Constantine Cannon LLP; Jill M. Manning of Pearson Simon & Warshaw LLP; and Allan Steyer of Steyer Lowenthal Boodrookas Alvarez & Smith LLP.
The Sutter Health Antitrust Class Action Lawsuit is Sidibe et al. v. Sutter Health, Case No. 3:12-cv-04854, in the U.S. District Court for the Northern District of California.
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One thought on $1.2B Sutter Health Antitrust Class Action Trial Underway
I did pay significantly to Blue Cross both through Emploer and COBRA before, during and after a Sutter hospital stay